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Gartner says mid-size enterprises should take a more strategic approach with IT spending

Only one-third of IT spending in mid-size enterprises directly improves business performance, according to Gartner ...


April 6, 2005  


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Only one-third of IT spending in mid-size enterprises directly improves business performance, according to Gartner Inc.

And since they spend most of their budget on infrastructure, which is the foundation of all operations, business unit managers often do not recognize or appreciate the value of these investments and therefore their view of IT departments is compromised.

“Many mid-size business executives have become disenchanted with technology solutions that they do not perceive to deliver business value,” said James Browning, research vice president at Gartner.

“This has led to low credibility in many cases, which carries a high price for IT departments — pressure on budgets and lack of resource commitments in an IT environment of scarcity.”

The research and consulting firm said, many mid-size businesses struggle to prioritize IT investments and properly allocate assets.

The challenge for IT managers in these organizations is that they are not always included in strategy meetings with business managers on the goals for the company.

“The task of the IT organization is to achieve high effectiveness at acceptable levels of efficiency and customer satisfaction,” Browning said. “This is best accomplished when planning is interactive between IT and the business units.”